U.S. Cannabis Spot Index — May 17, 2019

U.S. Cannabis Spot Index — Published May 17, 2019

U.S. Cannabis Spot Index up 1.6% to $1,123 per pound. The simple average (non-volume weighted) price increased $23 to $1,236 per pound, with 68% of transactions (one standard deviation) in the $510 to $1,961 per pound range. The average reported deal size increased 7% to 3.3 pounds from 3.1 pounds last week. In grams, the Spot price was $2.48 and the simple average price was $2.72.

 

The relative frequency of trades for greenhouse flower increased by 2%. The relative frequency of transactions involving outdoor product decreased by the same proportion, while that for deals involving indoor flower was unchanged. Outdoor product’s share of the total documented weight moved nationally grew by 2% this week. The relative volumes of warehouse and greenhouse flower both contracted by 1% compared to last week.  

 

The U.S. Spot Index rose by 1.6% this week to settle at $1,123 per pound, matching the national average composite rate documented two weeks ago. Rumblings of undesirable inventory in Oregon’s ostensibly oversupplied market and a shrinking pool of licensed cultivators in California appear to be contributing to the modest upswing in national wholesale prices. The Spot Indices of Washington and Nevada are also currently experiencing recoveries after sinking to historic lows for those markets earlier this year. Further upward pressure on supply side rates is originating from smaller medical cannabis markets that are experiencing significant increases in demand in 2019. Still, the U.S. Spot has demonstrated relative steadiness so far this year, underpinned by stability in pricing in California and Colorado, the country’s two largest markets.    

The national volume-weighted price for flower to be sold in adult-use markets once again declined marginally this week, due almost entirely to a decrease in that sector of California’s market. Falling prices in Alaska also provided some downward pressure on the national rate.

 

Prices for medical product were up this week on rising rates in California, Arizona, Michigan, Maine, New Hampshire, Rhode Island, and Vermont.

June Forward unchanged at $1,035 per pound. The average reported forward deal size was 42 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 55%, 31%, and 14% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 36 pounds, 49 pounds, and 48 pounds, respectively.

 

At $1,035 per pound, the June Forward represents a discount of 7.9% relative to the current U.S. Spot Price of $1,123 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

  • Review of Cultivation Licensing Data Shows Less Than 1,200 Distinct Growing Operations Now Hold Active, Valid Licenses
  •  
  • Colorado

    Total Retail Sales and Revenues from Adult-Use Market Both Reached New Record Highs in March, As State Spot Index Rose Slightly

  • Oregon

  • Retail Sales Revenue and Volume Down Slightly in April, Monthly Spot Index Off by Almost 7% from March
  •  
  • Washington

  • State Composite Price Down by 17% Year-Over-Year, But is Up by Over 23% Since Start of 2019
  •  
  • Arizona

  • Sales Volume to Patients Climbed to Historic Peak in April; Day of 4/20 Accounted for 10% of Total Monthly Sales

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

17 May 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — May 10, 2019

U.S. Cannabis Spot Index — Published May 10, 2019

U.S. Cannabis Spot Index down 1.6% to $1,105 per pound.

 

The simple average (non-volume weighted) price increased $26 to $1,212 per pound, with 68% of transactions (one standard deviation) in the $455 to $1,969 per pound range. The average reported deal size increased nearly 6% to 3.1 pounds. In grams, the Spot price was $2.44 and the simple average price was $2.67.

 

The relative frequency of trades for outdoor flower increased by 2%. The relative frequency of transactions involving indoor and greenhouse product both decreased by 1% week-over-week. Warehouse flower’s share of the total reported weight moved contracted by 6% this week. The relative volume of outdoor product expanded by the same proportion, while that for greenhouse flower was flat compared to last week.

 

The U.S. Spot Index fell by 1.6% this week to settle at $1,105 per pound. The overall decrease in the national composite price was due to a greater prevalence of lower-priced outdoor flower observed in the supply mix this week. From a state-level perspective, declines in California and Washington State accompanied the downturn in the U.S. Spot, although going rates in smaller markets such as Alaska, Illinois, and New Mexico also provided negative pressure on the national average. It is possible that this week’s decline signals the beginning of a post-4/20 slide in wholesale prices that has been observed nationally and in virtually all of the major markets in both 2017 and 2018, as we detailed in our report for April 19th. However, regulatory turbulence in California and Michigan may result in upward pressure on wholesale rates in the weeks to come, while prices in the other major markets of Colorado, Oregon, and Washington have demonstrated relative stability recently.    

The national volume-weighted price for flower to be sold in adult-use markets declined marginally this week, as decreases in California, Washington, and Alaska outweighed increases in Colorado, Oregon, and Nevada. Prices for medical product were down this week on declines in California, Colorado, Illinois, and New Mexico.         

June Forward unchanged at $1,035 per pound.

 

The average reported forward deal size was 41 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 56%, 31%, and 13% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 35 pounds, 49 pounds, and 50 pounds, respectively.

 

At $1,035 per pound, the June Forward represents a discount of 6.3% relative to the current U.S. Spot Price of $1,105 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

  • State Spot Index Drops Sharply, Settling Below $1,100 Per Pound and Approaching Current Annual Low
  •  
  • Colorado

    Number of Adult-Use Storefronts Up Compared to a Year Ago, While Medical Dispensaries and Active Cultivation Licenses of Both Types all Decreased

  • Oregon

  • State Data Shows Retail Revenue and Flower Sales Volume Set New Records in March, but Wholesale Prices Still Declined Despite Historic Demand
  •  
  • Washington

  • State Spot Index Down Almost 20% Year-Over-Year Due Mainly to Declines in Prices for Greenhouse and Outdoor Flower
  •  
  • Illinois

  • Recently-Introduced Adult-Use Legalization Bill Will License New “Craft Cultivators” but Not Larger-Scale Growers, Raising Concerns About Supply

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10 May 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — May 3, 2019

U.S. Cannabis Spot Index — Published May 3, 2019

U.S. Cannabis Spot Index up 2.3% to $1,123 per pound.

 

The simple average (non-volume weighted) price increased $35 to $1,186 per pound, with 68% of transactions (one standard deviation) in the $425 to $1,948 per pound range. The average reported deal size increased to 2.9 pounds. In grams, the Spot price was $2.48 and the simple average price was $2.62.

 

The relative frequency of trades for indoor flower increased by 4%. The relative frequency of transactions involving outdoor product decreased by the same proportion, while that for greenhouse flower was unchanged. Warehouse product’s share of the total reported weight moved grew by 2% this week. The relative volume of greenhouse flower contracted by the same proportion, while that for outdoor product was flat compared to last week.

 

The U.S. Spot Index rose by 2.3% this week to settle at $1,123 per pound. The five largest adult-use markets – California, Colorado, Oregon, Washington, and Nevada – all saw increases in their composite prices for the second consecutive week. As we have noted in prior reports, this year’s observations of depressed national wholesale prices in late March, followed by rising rates through April and into May, are the opposite of behavior documented in both 2017 and 2018. As we expand upon below, sharp decreases in the amount of licensed cultivators active in California’s regulated market may be contributing to upward price pressure in the Golden State, while retail demand in Colorado was up through the early months of this year after largely plateauing in 2018. Nevada’s Spot Index has been on the upswing for a month straight now, after sinking to a historic low for the state at the beginning of April.  

The national volume-weighted price for flower to be sold in adult-use markets rose once again this week on increases in Colorado, Oregon, Washington State, Nevada, and Alaska. California again saw a week-over-week downturn in its adult-use sector. Prices for medical product were also on the rise this week on increases in California, Colorado, Arizona, New Mexico, and Maine.      

November 2019 Forward initially assessed at $975 per pound.

 

The average reported forward deal size was 40 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 57%, 30%, and 13% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 32 pounds, 50 pounds, and 51 pounds, respectively.

 

The November 2019 Forward is initially assessed at $975 per pound, matching the October 2019 Forward. For context, the U.S. Spot Index averaged $1,076 and $1,075 in October and November 2018, respectively; and $1,421 and $1,412 in October and November 2017, respectively.

 

At $1,035 per pound, the June Forward represents a discount of 7.8% relative to the current U.S. Spot Price of $1,123 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

     

  • Number of All Active Cultivation Licenses Down Almost 50% from End of 2018
  • Licensed Retailers in Los Angeles Generated Over $375 Million in Total Sales Last Year
  •  
  • Colorado

    Monthly Spot Index for April is Lowest Observed So Far in 2019

  • Oregon

  • Composite Price Up for Third Consecutive Week on Rising Rates for Greenhouse & Outdoor Flower
  •  
  • Washington

  • State Spot Index Rises to Year-to-Date High for Second Straight Week, Settling Above $600 Per Pound for First Time in 2019
  •  
  • Massachusetts

  • April Adult-Use Sales Increase by 25% Month-Over-Month, But State Spot Index Down as Production Expands
  •  
  • Michigan

  • Licensed Dispensaries No Longer Permitted to Purchase Product from Caregivers, Must Obtain Tested Inventory from Licensed Cultivators and Processors
  •  
  • New Mexico

  • Health Department Update Shows New Plant Counts for Licensed Producers, Statewide Production Capacity Up 4.5X Compared to Previous Limits

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3 May 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — April 26, 2019

U.S. Cannabis Spot Index — Published April 26, 2019

4-Year Anniversary Edition!

This week’s edition of the U.S. Cannabis Spot Index marks our 4-year anniversary of providing weekly wholesale cannabis spot index reports! We thank you all for your interest and support!

U.S. Cannabis Spot Index up 0.8% to $1,098 per pound.

 

The simple average (non-volume weighted) price decreased $28 to $1,151 per pound, with 68% of transactions (one standard deviation) in the $405 to $1,897 per pound range. The average reported deal size was nominally unchanged at 2.8 pounds. In grams, the Spot price was $2.42 and the simple average price was $2.54.

 

The relative frequency of trades for indoor flower decreased by 3%. The relative frequency of transactions involving greenhouse and outdoor product increased by 2% and 1%, respectively. The relative volumes of each grow type were unchanged compared to last week. In the four major Western markets, small shifts in each product type’s share of the reported weight moved were observed, with warehouse flower seeing slight increases in its relative volume in most of the states in question.    

 

The U.S. Spot Index rose by 0.8% this week to settle at $1,098 per pound. In what was for the most part uncharacteristic post-4/20 behavior, the Spot Indices of the five largest adult-use markets – California, Colorado, Oregon, Washington, and Nevada – all saw increases in their composite prices. Last year, only Colorado and Oregon experienced upticks in their Spot rates in the week subsequent to 4/20; of the five states under discussion, only Colorado did in 2017. Also notable this week were significant declines documented in the Spot Indices of several sizeable medical cannabis systems, among them Arizona, Massachusetts, Michigan, and New Mexico. While the increased demand associated with 4/20 is typically discussed in regard to adult-use markets, data from some medical programs such as Arizona has shown that patients take advantage of the “holiday” to stock up, which can depress demand subsequently.  

The national volume-weighted price for flower to be sold in adult-use markets rose this week on increases in Colorado, Oregon, Washington State, and Nevada. California also saw a week-over-week downturn in its adult-use sector. Falling prices for medical product in Arizona, Massachusetts, Illinois, Michigan, and New Mexico were primarily responsible for pulling down the national rate for flower to be sold to patients.       

May 2019 Forward closes up $15 at $1,065 per pound.

 

The average reported forward deal size was 43 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 58%, 28%, and 14% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were nominally unchanged at 40 pounds, 49 pounds, and 46 pounds, respectively.

 

At $1,065 per pound, the May Forward represents a discount of 3.0% relative to the current U.S. Spot Price of $1,098 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    BCC Data Shows Only 5% of Test Batches Have Failed Required Screenings in 2019, Compared to Over 13% in H2 2018

  • Colorado

    Number of Active Medical Cannabis Cultivation Licenses Down 10% From a Year Ago as Sales and Patient Counts in That Sector of the Market Decline

  • Oregon

  • Outdoor Flower Observed to Account for Roughly Two-Thirds of All Product Traded in April, Emphasizing Continued Glut of Unsold Inventory
  •  
  • Washington

  • Relative Volume of Outdoor Flower Jumped by 14% in the First Three Weeks of April, After Holding Fairly Steady Through Q1 2019
  •  
  • Nevada

  • Official February Sales Data Shows Small Decline in Demand After Months of Stagnation, Corresponding to Sliding Wholesale Prices in that Month
  •  
  • Maine

  • Draft Rules for Adult-Use Industry Provide Blueprint for Future Market, But Questions Remain Regarding Product Testing, Other Issues
  •  

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

26 April 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — April 19, 2019

U.S. Cannabis Spot Index — Published April 19, 2019

U.S. Cannabis Spot Index up 1.9% to $1,089 per pound.

 

The simple average (non-volume weighted) price increased $18 to $1,179 per pound, with 68% of transactions (one standard deviation) in the $394 to $1,964 per pound range. The average reported deal size decreased to 2.8 pounds from 2.9 pounds last week. In grams, the Spot price was $2.40 and the simple average price was $2.60.

 

The relative frequency of trades for indoor flower increased week-over-week by 3%. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for deals involving outdoor flower was unchanged. Warehouse product’s share of the total documented weight moved grew by 3% compared to last week. The relative volumes of greenhouse and outdoor product contracted by 1% and 2%, respectively.

One day ahead of 4/20, the U.S. Spot Index rose by 1.9% this week to settle at $1,089 per pound. In 2018 at this time, the national composite rate experienced its third consecutive week of declining prices, closing at $1,331 per pound after cresting as high as $1,392 per pound in the final week of March. This year, the weeks of late March and early April have seen the U.S. Spot fall to some of its lowest points thus far in 2019, a departure from the elevated rates documented at the end of March in both 2017 and 2018.  

 

Notably, the country’s five largest legal cannabis markets – California, Colorado, Washington, Oregon, and Nevada – all saw increases in their Spot Indices this week, largely in defiance of trends leading up to this weekend’s industry “holiday”.

 

Overall, the apparent impact of 4/20 on wholesale prices in those states has diminished over time. Supplies of available inventory are more ample generally, blunting the effect of any increases in demand. Additionally, reports from the field have stated that retailers often seek out lower-priced lots ahead of 4/20, so that sales and specials may be offered without impacting margins negatively.

The national volume-weighted price for flower to be sold in adult-use markets rose this week on increases in Colorado, Oregon, Washington State, and Nevada. Other states with recreational markets, such as Alaska and Massachusetts, saw declines in their Spot Indices, while California also saw a week-over-week downturn in its adult-use sector. Rising prices for medical product in California, Michigan, and New Mexico were primarily responsible for pushing up the national rate for flower to be sold to patients.      

May 2019 Forward unchanged at $1,050 per pound.

 

The average reported forward deal size declined to 43 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 60%, 27%, and 13% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 40 pounds, 49 pounds, and 46 pounds, respectively.

 

At $1,050 per pound, the May Forward represents a discount of 3.5% relative to the current U.S. Spot Price of $1,089 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    State Spot Index Up Slightly, Even as Price for Indoor Flower Fell to a Year-to-Date Low

  • Colorado

    Month-to-Date Average Composite Price for April Down Compared to March, A Departure from Previous Years

  • Oregon

  • Volume-Weighted Price for Greenhouse Product Fell to All-Time Low for Any Market This Week, But State Spot Index Up from Last Week’s Historic Trough
  •  
  • Washington

  • Volume-Weighted Price for Indoor Flower Up 12.5% from Beginning of April to This Week
  •  
  • Nevada

  • State Spot Index Up Almost 10% in Two Weeks Ahead of 4/20
  •  
  • Arizona

  • State Data Shows Record Sales Volume in March, But Wholesale Pricing Generally Declined
  •  
  • Illinois

  • Retail and Wholesale Sales Jumped to New Record Highs in March, As State Spot Index Climbed to Current Annual Peak  

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

19 April 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — April 12, 2019

U.S. Cannabis Spot Index — Published April 12, 2019

U.S. Cannabis Spot Index up 0.3% to $1,068 per pound.

 

The simple average (non-volume weighted) price increased $53 to $1,161 per pound, with 68% of transactions (one standard deviation) in the $389 to $1,932 per pound range. The average reported deal size increased to 2.9 pounds from 2.7 pounds last week. In grams, the Spot price was $2.36 and the simple average price was $2.56.

 

The relative frequency of trades for indoor flower increased week-over-week by 4%. The relative frequency of transactions involving greenhouse and outdoor product decreased by 1% and 3%, respectively. Greenhouse product’s share of the total reported weight moved nationwide contracted by 2% relative to last week. The relative volumes of warehouse and outdoor flower both increased by 1% each. National relative volumes one year ago at this time were observed at 53%, 29%, and 18%, for indoor, greenhouse, and outdoor product, respectively.  

The U.S. Spot Index ticked upward marginally this week, by $2, to settle at $1,068 per pound, recovering slightly from last week’s current annual low. Relative steadiness in the Spot Indices of California and Washington helped to offset declines in Colorado and Oregon, while rising rates in Nevada, Michigan, New Mexico, and Alaska, among others, ultimately pushed the national composite price up a bit. Last year at this time – a week ahead of 4/20 – the U.S. Spot Index slipped by 1.4%, from $1,386 to $1,367 per pound, although it must be noted that it had previously trended upward from mid-February through early April. This week’s national composite price is off by 22% year-over-year, maintaining the overall rate of decline observed in annual average prices from 2017 to 2018, which was 23%.

The national volume-weighted price for flower to be sold in adult-use markets rose slightly this week on significant increases in the Spot Indices of Nevada and Alaska, as well as a modest uptick in Washington’s composite price. Rising prices for medical product in Illinois, Michigan, and New Mexico, as well as a couple other smaller markets, were primarily responsible for pushing up the national rate for flower to be sold to patients.    

May 2019 Forward unchanged at $1,050 per pound.

 

The average reported forward deal size declined to 44 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 60%, 28%, and 12% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 41 pounds, 49 pounds, and 44 pounds, respectively.

 

At $1,050 per pound, the May Forward represents a discount of 1.7% relative to the current U.S. Spot Price of $1,068 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    Volume-Weighted Prices for Product in Adult-Use Sector Reported to Fall Sharply for Second Consecutive Week

  • Colorado

    Monthly Retail Sales Slip for Second Straight Month in February, But Year-Over-Year Revenue Growth Stands at Almost 14% Through First Two Months of 2019

  • Oregon

  • State Spot Index Drops to All-Time Low for Any Market, Settling Below $500 Per Pound This Week
  •  
  • Washington

  • Analysis of Raw Transaction Data Shows Compression of Wholesale Prices Across All Grow Types, Particularly Indoor and Outdoor Flower
  •  
  • Nevada

  • Retail Demand in January 2019 Comparable to That Reported for Q4 2018; Wholesale Prices Also Showed Steadiness in Opening Month of This Year
  •  
  • Massachusetts

  • Adult-Use Revenues Grew Almost 35% from February to March, Medical Sales Volume Up 12% in Same Period; Yet State Spot Index Stabilized in Latter Month, Suggesting Production is Catching Up to Demand

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12 April 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — April 5, 2019

U.S. Cannabis Spot Index — Published April 5, 2019

U.S. Cannabis Spot Index down 2.0% to $1,066 per pound.

 

The simple average (non-volume weighted) price decreased nearly $10 to $1,108 per pound, with 68% of transactions (one standard deviation) in the $369 to $1,846 per pound range. The average reported deal size was nominally unchanged at 2.7 pounds. In grams, the Spot price was $2.35 and the simple average price was $2.44.


The relative frequency of trades for indoor flower decreased week-over-week by 1%. The relative frequency of transactions involving outdoor product increased by the same proportion, while that for deals involving greenhouse flower was flat. Greenhouse product’s share of the total reported weight moved nationwide increased by 3% relative to last week. The relative volumes of warehouse and outdoor flower both contracted, by 2% and 1%, respectively.   

The U.S. Spot Index declined by 2% this week, resuming the downward trend that commenced in mid-February and sliding to a year-to-date low of $1,066 per pound. The five largest adult-use markets – California, Colorado, Oregon, Washington, and Nevada – all saw their composite prices decrease this week. Notably, reported wholesale rates in California remain relatively stable, despite some market observers sounding the alarm regarding the expiration of temporary cultivation licenses, a matter we discuss below in more detail. This week also saw several markets that have seen rising prices for much of this year experience declines, namely Illinois, Rhode Island, and Washington, D.C. With just two weeks to go ahead of 4/20, it appears that the holiday will not result in discernible upward movement in the national composite rate, as it has in previous years.

The national volume-weighted price for flower to be sold in adult-use markets declined this week on decreases in all four of the major Western markets, as well as Nevada and Alaska. Rising prices for medical product in Maine, Michigan, and Massachusetts were primarily responsible for pushing up the national rate for flower to be sold to patients.   

October 2019 Forward initially assessed at $975 per pound.

 

The average reported forward deal size declined to 45 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 59%, 29%, and 12% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 42 pounds, 49 pounds, and 44 pounds, respectively.

 

The October 2019 Forward was assessed at $975 per pound, 3.9% lower than the September Forward of $1,015 per pound. For context, the U.S. Spot Index averaged $1,117 in September 2018 and declined 3.7% to $1,076 in October 2018.

 

 

At $1,050 per pound, the May Forward represents a discount of 1.5% relative to the current U.S. Spot Price of $1,066 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    Regulators Announce Intent to Issue Provisional Licenses as Temporary Permits Expire in Attempt to Avoid Market Disruption

  • Colorado

    Wholesale Prices Continued to Rise in Q1 2019, But Upward Momentum Slowed in March

  • Oregon

  • Falling Prices for Indoor and Greenhouse Flower, Increasing Relative Volume of Inexpensive Outdoor Product, Pulled State Spot Index to Historic Lows in Q1
  •  
  • Washington

  • Despite Price Rises Early This Year, Quarterly Average Spot Price for Q1 2019 Nearly Identical to Q4 2018’s Mean
  •  
  • Michigan

  • March 31st Licensing Deadline Goes Unenforced Due to Lawsuits Brought Against the State
  •  
  • Rhode Island

  • State Spot Index Up This Year as Sales and Patient Counts Grow, But New Cultivators Coming Online Could Provide Downward Pressure on Prices

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

5 April 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — March 29, 2019

U.S. Cannabis Spot Index — Published March 29, 2019

U.S. Cannabis Spot Index up 1.2% to $1,087 per pound.

 

The simple average (non-volume weighted) price increased more than $5 to $1,117 per pound, with 68% of transactions (one standard deviation) in the $385 to $1,850 per pound range. The average reported deal size declined to 2.7 pounds. In grams, the Spot price was $2.40 and the simple average price was $2.46.

 

The relative frequency of trades for greenhouse flower decreased week-over-week by 1%. The relative frequency of transactions involving outdoor product increased by the same proportion, while that for indoor flower was flat. Warehouse product’s share of the total reported weight moved nationwide increased by 2% compared to last week. The relative volumes of both greenhouse and outdoor flower each decreased week-over-week by 1%.

The U.S. Spot Index reversed a sustained decline this week, ticking upward by 1.2% to settle at $1,087 per pound. The national composite rate rose on an increase in the volume-weighted price for indoor flower, as well as an expansion in that grow type’s relative volume. The U.S. rate for warehouse product is being pushed up by rising prices in the mid-sized medical markets of Illinois, Maine, Michigan, and New Mexico; of the four major Western markets only Washington saw prices for indoor flower increase this week. Expanding patient counts and demand in the first and final medical markets just listed have been driving prices in those states upward, while shifting regulatory landscapes in Michigan and Maine have resulted in uncertainty for participants in those markets.

The histograms below show price dispersion by grow type for March 2019 versus March 2018. Most notably, nearly 80% of outdoor transactions were priced above $600 per pound last year, whereas nearly 85% are currently priced below $600. Additionally, expansion of greenhouse capacity in higher priced markets such as Nevada (compared to West Coast markets) helped increase the proportion of greenhouse transactions priced above $1,000 per pound from 34% to 43%.   

April 2019 Forward closes unchanged at $1,075 per pound.

 

The average reported forward deal size declined to 46 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 59%, 28%, and 13% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 44 pounds, 48 pounds, and 44 pounds, respectively.

 

At $1,075 per pound, the April Forward represents a discount of 1.1% relative to the current U.S. Spot Price of $1,087 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    Over 300 Annual and Provisional Cultivation Licenses Issued Between Late February and March 22nd, But 3,450 Listed as “About to Expire” as of Last Week

  • Colorado

    Taxes on Flower Transferred Internally by Vertically-Integrated Adult-Use Operations Will Rise by Over 3% in Q2, the Second Consecutive Quarter to See an Increase

  • Oregon

  • Retail Demand Slides in February for Second Consecutive Month, as Spot Index Fell to a Historic Low for the State’s Market
  •  
  • Washington

  • LCB Canopy Report Shows that Growers are Not Fully Utilizing Allowed Production Capacity, Large Operations Hold Outsized Market Share
  •  
  • Nevada

  • State Spot Index Again Drops Sharply, Establishing New Historic Low for the Market for the Second Straight Week
  •  
  • Michigan

  • Unlicensed Dispensaries That Account for Almost Half of Operational Storefronts in the State to be Compelled to Close at End of March, Reducing Wholesale Demand

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

29 March 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — March 22, 2019

U.S. Cannabis Spot Index — Published March 22, 2019

U.S. Cannabis Spot Index down 1.7% to $1,074 per pound.

 

The simple average (non-volume weighted) price decreased $43 to $1,112 per pound, with 68% of transactions (one standard deviation) in the $392 to $1,831 per pound range. The average reported deal size was nominally unchanged at 2.8 pounds. In grams, the Spot price was $2.37 and the simple average price was $2.45.

 

The relative frequency of trades for indoor flower decreased week-over-week by 3%. The relative frequency of transactions involving greenhouse and outdoor product increased by 1% and 2%, respectively. Outdoor flower’s share of the total reported weight moved nationwide increased by 2% compared to last week. The relative volume of warehouse-grown product decreased by the same magnitude, while that for greenhouse flower was stable week-over-week at just under a quarter of all documented weight moved nationally.  

The U.S. Spot Index ticked downward for the fifth consecutive week, by 1.7%, to settle at $1,074 per pound. This week is the third consecutive one in which the national composite price has fallen to establish a new year-to-date low. As we have pointed out previously, the behavior of the U.S. Spot in recent weeks has diverged from the upward momentum observed at this point in the year in both 2017 and 2018. Plentiful available inventory in the major adult-use markets is likely suppressing wholesale rates even as 4/20 approaches. Additionally, the ramp-up in production that has been occurring in Nevada since prior to adult-use sales opening in mid-2017 appears to have resulted in supply outpacing demand in the Silver State, which is currently seeing the most pronounced downward trend in wholesale prices of any sizeable legal cannabis market in the country.  

The national volume-weighted price for flower to be sold in adult-use markets declined this week on significant downturns in Oregon and Nevada, as well as a decline in Washington, which overwhelmed increases in California and Colorado. Falling prices for medical product in Arizona, Massachusetts, Michigan, and New Mexico, among other markets, pulled down the national rate for flower to be sold to patients.   

April 2019 Forward unchanged at $1,075 per pound.

 

The average reported forward deal size was unchanged at 46 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 58%, 29%, and 13% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 45 pounds, 48 pounds, and 44 pounds, respectively.

 

At $1,075 per pound, the April Forward is nominally equivalent to the current U.S. Spot Price of $1,074 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    Volume-Weighted Price for Indoor Flower Down by 5% Since Beginning of March, After Rising Through First Two Months of 2019

  • Colorado

    State Spot Index, Prices for Indoor and Greenhouse Flower, Up Compared to a Year Ago as Wholesale Rates Continue to Trend Upward in Current Quarter

  • Oregon

  • Spot Index Slips to Historic Low for the State, Settling Under $550 Per Pound
  • Relative Volume of Outdoor Flower Sees Significant Expansion This Week as Official Data Shows 1.15 Million Pounds of Unsold Plant Material in Licensed System
  •  
  • Washington

  • State Economists Report Lower-Than-Expected Tax Collections from State’s Cannabis Industry in February, But Expect Revenues to Rise and Stabilize Later this Year
  •  
  • Nevada

  • State Spot Index Settles Under $1,600 Per Pound for the First Time
  •  
  • Arizona

  • Total Sales Volume Decreases in February for Second Consecutive Month, Even as Sales of Extracts Jump Sharply

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

22 March 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — March 15, 2019

U.S. Cannabis Spot Index — Published March 15, 2019

U.S. Cannabis Spot Index down 0.7% to $1,092 per pound.

 

The simple average (non-volume weighted) price decreased $30 to $1,155 per pound, with 68% of transactions (one standard deviation) in the $415 to $1,894 per pound range. The average reported deal size declined to 2.8 pounds from 3.1 pounds last week. In grams, the Spot price was $2.41, and the simple average price was $2.55.

 

The relative frequency of trades for indoor flower increased week-over-week by 1%. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for deals for outdoor flower was unchanged. Outdoor product’s share of the total reported weight moved nationwide contracted by 1% compared to last week. The relative volume of greenhouse flower increased by the same magnitude, while that for indoor product was stable week-over-week.

The U.S. Spot Index ticked downward for the fourth consecutive week, by 0.7%, to settle at $1,092 per pound. At this point, it appears unlikely that a late-March rally in the national composite price will occur, as it has in each of the previous two years. 2017’s annual high price was observed in the final week of March, while the same week last year saw the second-highest weekly Spot rate documented in 2018. Still, it should be noted that sustained upward momentum in wholesale prices has been observed in several mid-sized and small markets so far this year – notably Michigan, Massachusetts, and Illinois. However, low and declining prices in the West Coast markets have overwhelmed those gains. Colorado’s Spot Index also saw its second decline in three weeks, tempering the consistent ascent of prices that was observed earlier this year.

The national volume-weighted price for flower to be sold in adult-use markets this week ticked upward slightly. While Oregon was the only such market to see an increase in its Spot Index, an increase in reported trading volume from that state lent the price rise more influence, causing it to outweigh marginal decreases in the other major recreational markets.         

April 2019 Forward unchanged at $1,075 per pound.

 

The average reported forward deal size declined nominally to 46 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was unchanged at 56%, 28%, and 16% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 50 pounds, 41 pounds, and 41 pounds, respectively.

 

At $1,075 per pound, the April Forward represents a discount of 1.6% relative to the current U.S. Spot Price of $1,092 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample Headlines From This Week’s Premium Report:

  • California

    Los Angeles Releases New Info on Next Phase of Local Licensing, But Timeline for More Retailers to Open Remains Uncertain

  • Colorado

    Total Retail Sales in January 2019 Down Month-Over-Month, But Up Almost 6% From January 2018

  • Oregon

  • State Spot Index Sees Second Consecutive Increase, Slowing Downward Momentum of Wholesale Prices Observed So Far in 2019
  •  
  • Washington

  • Composite Price Off by Almost 3% from Recent Peak Observed a Month Ago, After 12.5% Rise to Open 2019
  •  
  • Michigan

  • Recent Report Shows Steady Sales at Licensed Dispensaries from December through February As State Spot Index Rose During That Span

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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

15 March 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved